Co-Integration Analysis of Economic Development and Democracy: The Case of Turkey

The relationship between economic growth and democracy is a contentious issue in the literature of comparative politics and political economy. Empirical studies have reached various conclusions, depending upon the sample, data and model utilized. Furthermore there are deviations between certain countries in terms of the relationship between economic growth and democracy. Thus, country specific models have critical importance to shed light on these deviations between those different countries. In this study, we construct a co-integration model of the Turkish economy to examine the relationship between economic growth and democracy. From its very foundation, Turkey has experienced economic and political crises. However, few empirical studies have investigated the relationship between these two traits. Using co-integration analysis for the period 1955 to 2006, we seek to identify the relationship between economic growth and democracy. Our empirical results suggest that there is a long run equilibrium between economic grow th and democracy in Turkey.